Many retailers are moving towards supplier managed inventory. Retailers who have built a trusting business relationship with their suppliers often do not want to manage their own inventory. An effective means of managing inventory is automated forecasting. Advances in technology have made forecasting technology generally available. However, forecasting technology remains very expensive and often difficult, if not impossible, to implement.
Although existing forecasting schemes have made a substantial positive impact on the ability to manage inventory, they do still suffer from some important drawbacks. For example, an on site forecasting system requires significant on-site resources. Most current inventory management schemes will not allow a supplier to interact with and manage retailer inventory automatically without significant retailer intervention. For example, it is typically not possible for a supplier to create a purchase order for, and to ship and bill inventory associated with that purchase order without input by the retailer.
In addition to requiring an abundance of on-site resources, forecasting can be expensive. A typical application may be beyond the budget of a small or mid-sized retailer or supplier. Similarly, once committed to a forecasting engine both the retailer and the supplier are, to some degree, locked into such a provider. For example, the forecasting engine may become obsolete, perform below expectations, or lack adequate customer support. As will be easily recognizable, this can have a significant negative impact on the subscriber's continuing business operations.
The availability and recent popularity of value added networks provides an attractive alternative to retailer forecasting and inventory management. Many businesses have become dependent on these so-called "distributed" systems for accessing, storing and processing data generated by or required by the business. The components which are accessed from the client (or a dumb terminal) may be part of the businesses' network or they may be components operated by affiliated or unaffiliated third parties. For example, Electronic Data Interchange (EDI) allows businesses to exchange many kinds of data with each other electronically. An electronic network is typically owned and operated by a third party service provider which contracts with the businesses subscribing to the electronic network. In a typical arrangement, both a vendor and a purchaser will subscribe to the electronic network. These parties may exchange electronic mail messages (E-mail), purchase orders, approvals and inventories as well as a myriad of other information through the network. Additionally, various levels of processing may occur within the network so as to automate the business transactions occurring between the vendor and the supplier. These networks are often described as "value added networks" (VANs).
Unfortunately, however, these systems do not provide effective forecasting and replenishment applications. Although VAN's can provide point of sale information, reviewing this information can become overwhelming and manually intensive. Thus, VAN's alone may not be an acceptable solution to inventory management.
Accordingly, a need has arisen for a data processing and data communications system allowing for cost efficient, secure and flexible inventory forecasting and replenishment which may be maintained by suppliers. It is also desirable to provide a system which allows the retailer to monitor the supplier's activity through a direct connection to the server.